A lot has changed in the debt relief environment over the last couple years. Until October 2010, debt relief and settlement companies could charge you upfront fees. Fortunately, the FTC changed that by making upfront fees illegal.

However, that doesn’t mean that debt relief scams no longer exist. The FTC upfront-fee ban doesn’t apply to some debt settlement attorneys.

Why upfront fees were made illegal

One of the reasons the FTC made upfront fees illegal was due to their and individual state investigations of the debt settlement industry.

Per the investigations they discovered that less than 10% of consumers who hired a long-term debt settlement company completed the service by settling all of their enrolled debt.

With an upfront fee in place, that meant that 90% of people were potentially being charged for services they never received.

Since then, the debt relief industry has shrunk dramatically. A lot of the bad actors who took advantage of consumers are no longer operating. However, the industry still has a long way to go until it can be viewed as offering a successfully reliable approach as a whole.

How to get a refund

Just so you know, I have never charged upfront fees. And, I’m very happy the practice of doing so has been made illegal. However, as I mentioned earlier, some debt settlement attorneys still do.

If you hired a debt settlement company previous to October 27th 2010 or if you recently hired a debt settlement attorney that charged you upfront fees and you’re not happy with your services and would like a refund, I recommend that you read Steve Rhode’s article on how to get a refund.

He has done a great job explaining step-by-step on how to handle the situation and how to increase your chances of successfully getting your refund.

Steve’s blog at getoutofdebt.org is also a great resource for other debt related information. There wasn’t a class in high school or college that focused on consumer finance. I believe by reading his blog, you can help make up for that. Consumer awareness is so critical in this day and age. His debt relief blog is an excellent source to educate yourself and become more aware of your personal finance needs.

I was formerly one of the most successful debt collectors in the country. And don’t worry, I wasn’t one of those huffy-puffy types. I also held positions of Collection Manager, Corporate Trainer, and Director of Collection Operations. I’ve worked for large third-party collection agencies, collection attorneys and large debt buyers. (full bio)

I’ve dedicated my website towards truly explaining how debt settlement really works and to dispel the myths revolving around credit and debt.

I was formerly one of the most successful debt collectors in the country. And don't worry, I wasn't one of those huffy-puffy types. I also held positions of Collection Manager, Corporate Trainer, and Director of Collection Operations. I’ve worked for large third-party collection agencies, collection attorneys and large debt buyers. (full bio)

I've dedicated my website towards truly explaining how debt settlement really works and to dispel the myths revolving around credit and debt. ...

Disclosure: I may be financially compensated by any of the entities that I recommend on this website.

All recommendations are provided purely based on who I feel the most comfortable with for the particular scenario.

If you are considering getting help with your debt, please take the time to educate yourself by reading these featured articles:

We’re the only debt settlement company he has EVER allowed on his referral list.

Tom Martino has been fighting for consumers for more than 30 years utilizing Radio, TV, Newspapers, Magazines, and the Internet. Tom can be heard weekday mornings on the radio from 9 to noon on Denver’s popular AM talk station 630-KHOW. Each show is filled with calls from people needing consumer help, information, and advice.

Debt Relief Á la carte is not a credit repair company. We do not provide legal, tax, or investment advice. If you need legal advice, legal expertise, or court filings, you must seek the advice of a licensed attorney. Estimates are based on your collectabilty, our past experience, and settlement performance trends. Individual results may vary. The claims made are examples of past performance and are not intended to be a guarantee of any future settlement results. We do not provide debt settlement services in all states. We use reasonable care to ensure that the information appearing on this website is up to date and accurate. While we take precautions to prevent the occurrence of errors and omissions, the users of this website should not take the accuracy of the information for granted but should seek individual professional advice that is relevant to their particular situation and needs.